A wrinkle in the Federal Court’s decision: Full Court overturns BOTOX v PROTOX finding

 This article reports on the Full Court appeal of a decision regarding trade mark infringement of the mark BOTOX by the use of PROTOX (Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2021] FCAFC 163). In a unanimous judgment, the Full Court (comprised of Jagot, Lee and Thawley JJ) allowed Allergan’s appeal, clarifying the law in relation to deceptive similarity and what constitutes trade mark use. This important decision clarifies the extent to which companies can use, refer to or seek to reference another company’s brand or mark. 

We have previously reported on the first instance decision of Allergan Australia Pty Ltd v Self Care IP Holdings Pty Ltd [2020] FCA 1530 in an article here.  

Brief overview of the dispute and the original Federal Court decision 

Allergan Inc (Allergan) is the registered owner of several BOTOX trade marks including two BOTOX marks registered in class 5 for ‘pharmaceutical preparations’, and two other marks, including a defensive mark, in class 3 for ‘cosmetics, … skin creams and lotions’.

Self Care IP Holdings Pty Ltd and Self Care Corporation Pty Ltd (Self Care) sell cosmetic products, including Protox, under the umbrella brand FREEZEFRAME. Self Care’s marketing and packaging depicted the word BOTOX in composite phrases, such as ‘clinically proven to prolong the effect of Botox®’.

Allergan claimed this use constituted, amongst other things, trade mark infringement under the Trade Marks Act 1995 (Cth) (the Act) as the PROTOX mark was ‘deceptively similar’ to the BOTOX mark and Self Care used the BOTOX mark on Freezeframe products, packaging and advertising.

At first instance, Stewart J found that Allergan failed to establish infringement of the BOTOX trade mark. His Honour concluded that the ubiquitous reputation in the BOTOX mark successfully countered a finding of deceptive similarity, as consumers would be unlikely to have an imperfect recollection of such a renowned mark.

The Court also refused to cancel Allergan’s defensive trade mark registration (a finding that Self Care did not appeal). 

Deceptive similarity: the correct test is whether there is confusion as to the source of the products, not confusion between the marks themselves

As a trade mark’s reputation is generally irrelevant to the assessment of deceptive similarity, it is unsurprising that Allergan appealed this decision.

Upholding Allergan’s appeal, the Full Court held that PROTOX is deceptively similar to BOTOX as there was a real risk that consumers would wonder whether the two products are from the same source.   

Critically, the Full Court emphasised that the confusion to which the relevant provisions of the Act are directed is confusion as to the source of the products as opposed to confusion between the marks or products themselves.[1] This ‘contextual confusion’ approach to deceptive similarity is sufficient to establish that one mark is deceptively similar to another (although it is not the only way such confusion can be established). However, it is clear from previous decisions that the test is not whether consumers might think the trade marks are the same but whether the goods come from the same source.[2]   

The ‘contextual confusion’ approach allows deceptive similarity to be found where the two marks themselves would not be confused (for one another) because of the differences in appearance, pronunciation or idea, but where consumers (understanding that the marks are different) might wonder whether they came from the same source. This is relevant here as the Full Court (agreeing with the finding of the primary judge) concluded that consumers would not have confused PROTOX for BOTOX, as the words are sufficiently different. 

The concept of contextual confusion counters the argument often advanced against owners of established brands that a well-known brand is simply too famous to allow any sort of confusion with a similar mark.[3] It also contradicts the trial judge’s reasoning, because the fame of the BOTOX mark is relevant to the question of whether the marks would be confused for one another. However, fame is not relevant to the question of whether consumers might wonder whether the respective products originated from the same source (for example, one could be a variant of another). The Court suggested that consumers might be caused to wonder whether PROTOX was a cosmetic (non-medicinal) variant of BOTOX that worked the same way, or if it was a treatment to be used in conjunction with BOTOX to improve or prolong results.[4]

Use as a trade mark

Self Care’s use of PROTOX was use as a trade mark 

Self Care issued a notice of contention to the effect that it was FREEZEFRAME PROTOX which it used as a trade mark, not the word PROTOX alone. The primary judge concluded it was “quite clear that PROTOX is used as a trade mark”.[5]

On the packaging of the PROTOX product, the word PROTOX was used separately from the word FREEZEFRAME. In addition, both words were presented against different coloured backgrounds. This enabled the Full Court to find that Stewart J was correct to conclude that PROTOX was used as a trade mark and that it was used independently of the mark FREEZEFRAME.

Self Care’s references to Botox was use as a trade mark and misleading 

The Full Court found that Self Care’s use of the phrase ‘instant Botox® alternative’ was use as a trade mark. This is in contrast to Stewart J’s finding that the phrase was descriptive. Stewart J had argued that the word ‘alternative’ served to emphasise that the product was not a BOTOX product. While the Full Court accepted that the word ‘alternative’ describes another possibility or choice,[6] it did not imply that the trade source was different. Accordingly, use of that word did not protect Self Care from infringing Allergan’s registered trade mark.  

While the words ‘instant’ and ‘alternative’ are descriptive, the Full Court held that the phrase “instant Botox® alternative” was not being used by Self Care in a purely descriptive way to distinguish its product from Allergan’s products. Rather, it was used to denote trade source connection with Allergan’s products and as such constituted use as a trade mark. This was contrasted with the phrase ‘Yeast Tablets, a substitute for Yeast-Vite’, which was found by the House of Lords to adequately distinguish the products from each other and therefore was not considered use as a trade mark.[7]

Other findings of the Federal Court include: 

• “instant Botox® alternative” was not used in good faith to indicate the intended purpose of characteristics of the product, therefore the defence under s 122(1)(b) failed.
  
  
• The phrase ‘instant Botox® alternative’ was misleading or deceptive as to efficacy (under the Australian Consumer Law), as it would convey to consumers that the effects of the PROTOX product would last for the same period as the effects achieved by a BOTOX treatment.
   
• Registration of FREEZEFRAME PROTOX does not provide a defence under s 122(1)(e) for use of PROTOX alone.

Key takeaways

This decision reiterates that contextual confusion is an important consideration in the assessment of deceptive similarity between marks. It should be kept in mind when pursuing (or defending) trade mark infringement claims, that confusion between the marks themselves is not the correct approach. Rather, consumer confusion as to the source of the products is the relevant question. 

The finding that the phrase “instant Botox® alternative” was trade mark use, and therefore amounts to trade mark infringement, is significant for businesses.   Companies need to think carefully before using third party trade marks in comparative advertising. The use of a word such as ‘alternative’ may not be sufficient to avoid a finding of trade mark infringement.  

Finally, the decision also highlights the strength and importance of defensive trade mark registrations for well-known marks. It was the BOTOX defensive registration which the Full Court ultimately found had been infringed, rather than any of the standard BOTOX registrations. Allergan’s standard BOTOX registration for ‘cosmetics’ had been successfully attacked for non-use. However, a non-use attack is not an option against defensive registrations, and the BOTOX defensive registration covering ‘cosmetics’ (being Self Care’s goods) was found to have been validly granted and therefore infringed.